Three exceptions are identified where the public interest will render an exculpatory clause unenforceable. They are: (1) when the party protected by the clause intentionally causes harm or engages in acts of reckless, wanton, or gross negligence; (2) when the bargaining power of one party to the contract is so grossly unequal so as to put that party at the mercy of the other's negligence; and (3) when the transaction involves the public interest.
Plaintiffs, husband and wife, entered into a participation agreement with defendant health club. The participation agreement contained an exculpatory clause which purported to release defendant from all liability for injuries caused by defendant's negligence. Following plaintiff wife's injury at defendant's club, plaintiffs sued defendant. Defendant's motion for summary judgment was granted, and plaintiffs appealed. The court affirmed judgment.
Is an exculpatory clause in a gym membership contract void, as against public policy?
First, the exculpatory clause was unambiguous and expressed a clear intent by the parties to release defendant from liability from all acts of negligence. Second, defendant did not provide an essential public service such that an exculpatory clause would be "patently offensive" to the citizens of Maryland, and the court would not invalidate the participation agreement, which was a private contract, on grounds of public policy unless the exculpatory clause was patently offensive.